Poverty—uneven demographics

The demographics of the United States of poverty show both that poverty is much worse than the numbers indicate and that poverty can be eliminated.

As David Johnson, chief of the Housing and Household Economic Statistics Division at the U.S. Census Bureau, explains (in a post by Phil Izzo), the poverty rate of young people is only as low as it is because they’ve been forced to move back in with their parents.

the share of people age 25-34 living with their parents jumped to 13.4% in 2010 from 12.7% in 2008. Families sticking together has likely held down the poverty rate, noted Johnson.

The poverty rate for adults age 25-34 living with their parents was 8.5%, but in that case they are considered part of a household. If their status was determined solely by their own income, 43% were below the poverty threshold for a single person.

On the other hand, the poverty rate among those 65 years or older declined in 2009 to 8.9 percent from 9.7 percent in the previous year, and from 15.3 percent in 1975 and 28.5 percent in 1966. Clearly, the Great Society programs—Medicare, Medicaid, housing subsidies, food stamps, and expanded Social Security—while they have not eliminated poverty among senior citizens, have led to dramatic reductions in the poverty rate.

Taken together, what these numbers show is that there’s nothing natural or permanent about levels or rates of poverty—that it’s possible, even within capitalism, to create the conditions under which poverty declines.

But only with the right programs, when the decision is made to provide people a decent standard of living.

Like this:

Yes, we can end poverty (at least end the poverty that is extreme and debilitating; relative poverty will persist).

We can achieve that rapidly, moreover, in a way that provides many additional benefits — social, cultural, political, and environmental — by updating an approach that was almost enacted in the 1960s. A plan actually passed in the House of Representatives by a margin of two-to-one, supported by moderate Democrats and moderate Republicans, but it was blocked in the Senate through the combined action of the extreme liberals and the extreme conservatives. That approach is a guaranteed income. Supporters included Martin Luther King Jr., Richard Nixon, George McGovern, and leading economists from the left and the right.

In contrast with the old approach — which was means-tested and targeted, and would therefore have required a massive government bureaucracy — the updated plan is much simpler and quite libertarian, and could be implemented while cutting taxes and shrinking government. It would set some basic income amount, say $1000 a month, and provide that to every adult citizen, poor and rich, unemployed and employed, married and single. That can be combined and funded with a flat income tax or higher carbon taxes.